City Government

Getting to the Airport

Several times a day, Wen Yen does something that many New Yorkers dread
doing several times a year: he goes to the airport.

Yen has been working as a driver for a car service since 1993, trading
pointers about shortcuts with other drivers, and developing his own
routes and alternative routes as he shuttles passengers to and from
Newark, La Guardia, and JFK.

Mainly, though, he gets stuck in traffic.

JFK is the worst of the three airports, thanks to crowded highways and poor parking facilities, but he says they are all pretty bad.

People like Yen have no choice but to travel to JFK - he drives wherever his company
dispatches him - but companies like Nippon Cargo Airlines have more and more alternatives. When it was faced
with a decision to send some of its flights into JFK or into Chicago's
O'Hare Airport, it looked at how easy it would be to get trucks to both
destinations. The company chose Chicago.

"I've had several trucking companies tell me that sometimes... it takes
four hours to get from Fort Lee [New Jersey] to Kennedy Airport," said
Peter Disenbach of Nippon Cargo. "When you're paying a truck driver $20
an hour, that's pretty expensive."

Getting to and from the airports is the number one issue affecting airports that were once indisputably on top.

"We're competing with so many other airports... that it's no longer guaranteed that La Guardia and Kennedy
will maintain their dominance in this industry," said Jonathan Bowles,
research director of the Center for an Urban Future, a local think tank
that has long been advocating for
airport improvements.

There are promising signs, though. The Port Authority has increased its
capital investments in New York's airports, and the city is looking into
improving the airports, using them to spark economic growth. In what is
being touted as a good first step toward addressing the airports'
transportation needs, a new Airtrain to JFK opened last year.

Most recently, Governor George Pataki has been among those advocating
for a $6 billion rail linking lower Manhattan with the Long Island Rail
Road and JFK. The plan's supporters describe it as the long sought
one-seat ride from the airport to Manhattan. But skeptics question
whether the project is the best way to solve the airports' problems - or
spend the city's cash.

STRUGGLING AIRPORTS

New York is regularly named one of the country's best tourist
destinations. When tourists get to the city, however, they face what
respondents to a readers' poll last year in Conde Nast Traveler magazine
designated the worst airport in the country: JFK. The same poll found
La Guardia to be the fourth worst.

Aging terminals, long delays, and, above all, terrible transportation to
and from the airports, have marked the decline of New York's airports,
once seen as some of the country's best. The conditions have driven away business: JFK, the seventh busiest airport in 1991, is now 11th. La Guardia dropped from being the
15th busiest to the 20th busiest airport in the nation.

Troubling trends at the city's airports were aggravated by the September
11, 2001 terrorist attacks. In the first year, 10,000 airport jobs disappeared -
the worst job loss of any sector in the city's economy after 9/11. The
drastic decline in the airline industry nationwide tightened the market,
increasing competition and further exposing the shortcomings of the
city's airports.

Doubtless, there will always be passengers for JFK and La Guardia
airports. But as passenger airlines and air cargo industries grow, the
city may lose the benefits of this growth to its competitors.

NEWARK AND NEW YORK: COOPERATING OR COMPETING?

In recent years, Newark International Airport has undergone a $3.8
billion renewal, which was topped off in October 2001 by the opening of
the Newark Airtrain. The new
system, by connecting to New Jersey Transit, allows passengers to get
from Penn Station to the airport in 20 minutes, and then to individual
terminals in another 10 minutes.

Obviously, this benefits New Yorkers, who can get to the airport much
quicker than they were able to in the past.

"New York City benefits by having all three airports available,
regardless of which state the passenger takes off from, just as New
Jersey benefits from having the two Queens airports available to them,"
said Jeffrey Zupan, senior fellow for transportation at the Regional
Plan Association.

But New York's neighbor is also its biggest competitor, and the city
does lose out in the form of jobs and tax revenues if business goes to
Newark instead of La Guardia or JFK.

Between 1989 and 1999, for instance, the Port Authority focused on
improving Newark's terminals and transportation, allowing that airport
to increase its workforce by 79 percent. Over the same decade, the
number of jobs at La Guardia increased by only 14 percent, and JFK
actually lost nine percent of its jobs.

Because the improvement of Newark has been accompanied by decline at JFK
and La Guardia, many have accused the Port Authority - which manages all
three airports - of playing favorites. Former Mayor Rudolph Giuliani
was so convinced that the Port Authority's approach was harmful to the
city that he tried to seize control of JFK and La Guardia.

The Port Authority - which recently renewed its lease of JFK and La Guardia under terms that will give the
city much more in rent - responds to accusations of favoritism by saying
it spends its funds where they are needed most. In recent years, the
agency has shifted capital investment back across the Hudson.

"I think it may be that things go in cycles. Newark had this great
potential for growth, and the Port Authority had to help accommodate
that growth. But in doing so, Kennedy and La Guardia were neglected,"
said Bowles. "The Port Authority has turned its attention to the New
York airports."

IMPROVING TRANSPORTATION

In looking to improve the city's airports, the Port Authority's most
obvious challenge is improving access. Public transportation to the
airports is poor and underused; a 2002 report by the Federal Transit
Administration found that only eight percent of
JFK passengers used public transportation (in pdf format), while five
percent of La Guardia passengers did. Most rely instead on congested
highways.

JFK's problems are much worse than those at La Guardia, causing it to
lose its spot at the country's top air cargo location.

The airport was the world's busiest air cargo hub until 1990;
today it's the country's fifth. While transportation is not the only
reason for this decline, many in the air cargo industry cite it as the
most serious problem facing their businesses in New York City.

There have been calls for modest changes on
the highways surrounding JFK for years: closing some exits at certain
times of day, allowing commercial vans onto the Belt Parkway (all
commercial traffic is currently banned), or adding a lane to the Van
Wyck Expressway to reduce gridlock. Some advocates believe tolls on the Van Wyck, coupled
with better public transportation, are the answer.

These changes would probably make personal travel from JFK more pleasant
and commercial traffic more profitable. But no movement has been made
on these proposals; there is little political will for any tampering
with the city's highways.

More politically palatable are ideas that would create better rail
lines, which would take riders off the highways and, theoretically,
reduce highway congestion. As an ultimate solution to JFK's
transportation woes, advocates have long called for the creation of a
so-called one-seat ride, which would take passengers to Midtown without
having to change trains.

The Airtrain

The Port Authority completed the JFK Airtrain in late 2001, a project
that came after decades of debate and does not provide a one-seat ride to
Manhattan. After almost a year in existence, the Airtrain is nearing
its goal of 34,000 daily riders. The majority of these passengers use
the Airtrain not to get to and from the airport, but to get around the
airport itself. Those who connect to the subway pay five dollars to use the Airtrain; those who use it to travel around the airport itself do not have to pay a fare to do so.

This has fed the argument of those who say the Airtrain is irrelevant for
Manhattanites, who have to take the subway to far-off stations in Queens and walk prodigious journeys before boarding it. This debate was one of many that raged over the project
in the decades between its conception and completion. Besides being
expensive - it cost $1.9 billion, paid for in part by the Port Authority
and in part by a surcharge on airfare - the project generated rigorous
opposition from local communities.

Such opposition is common for the ambitious transportation projects that
many believe are the only way to solve the airports' transportation
problems. In Astoria, Queens, community opposition caused a plan to
extend the N or R trains to La Guardia to be scrapped entirely. The Airtrain itself barely passed the city's review process.

The project's supporters acknowledge that it alone cannot put a serious
dent in the transportation problems at JFK.

"I know the project's been criticized for not being a one-seat ride to
the airport and therefore less appealing to non-business travelers and
the like," said Gene Russianoff of the Straphangers Union, a transit
advocacy group that backed the project. "But it's a good first step, and
hopefully in the long run we'll see a one-seat ride, at least to
midtown."

Rail Link to Lower Manhattan

Tapping the post 9/11 attention on lower Manhattan, Governor Pataki and
downtown business interests have been pushing to build a rail link from
JFK and the Long Island Railroad, through downtown Brooklyn, and into
lower Manhattan.

Before 9/11, proposed one-seat rides always terminated in Midtown. Many
do not see a connection to lower Manhattan as anywhere near as useful.

The plan calls for an expensive new tunnel under the East River, and
will cost a total of $6 billion. The governor's idea of paying for the
project from the pool of federal grant money for rebuilding after 9/11,
met tough opposition from others who had believed those funds would be
better used for other purposes. Pataki has since changed course,
convincing President George Bush to support converting $2 billion in
unused tax credits - also part of the federal post 9/11 aid - into cash
for the project. Congress still has to vote on the funding plan, and
even if it does approve it, it is unclear exactly where the remaining
funding will come from.

Supporters of the plan see its major feature as connecting lower
Manhattan to the LIRR, spurring the downtown economy; but also describe
the one-seat ride to JFK as a way to bring the airport back to the
cutting edge.

The rail link "will position New York alongside other world-class cities
that already have such seamless global access," said Pataki in a speech
this May.

But skeptics abound, saying that the likely number of riders doesn't
justify the price, and that the project overstates the economic benefit
for lower Manhattan. Some see a threat to the funds needed for a 2nd
Avenue subway; others fear the deterioration of the existing
transportation system as capital is spent on ambitious new projects.

Whether this skepticism can be turned into support may rest on how the
rail link connects to existing transportation systems: if it can be made
compatible with city subways; how well stops between JFK and the World
Trade Center Site serve local areas; and whether it is built to connect
to any future 2nd Avenue Subway. With the project in preliminary
stages, the answers to these questions are still unclear.

BUILDING ON POTENTIAL

The airports' shortcomings haven't completely hampered the ability of
airlines to succeed in Queens. JetBlue Airways, a low-cost airline that
is now the leading carrier out of JFK, brushed aside high real estate
prices and poor transportation to set up operations in New York City.

David Neeleman, the company's CEO, was met with skepticism when he
decided to anchor his company in Queens. Today, JetBlue's success has
been a rare one in an airline industry struggling in recent years.

"The remarkable thing when you look at JetBlueâ€¦ is that we operate out
of one of the most expensive airports in the world," Neeleman told
investors this summer. "Being able to be in New Yorkâ€¦the largest travel
market in the world, and being able to be efficient and use those costly
assets wisely is one of our greatest secrets."

The airline is currently looking to expand at both JFK and La Guardia.

Further, the Federal Aviation Administration projects that the air cargo
industry will grow by five percent every year until 2014, with
international shipping appearing particularly strong. Due to its
extensive experience in international shipping, JFK is particularly well
suited to capture this market. Improvements over the last few years have
put it in an even better position.

Through the efforts of the Port Authority, the city, and individual
airlines, JFK has undergone significant changes. Several terminals have
been torn down and rebuilt, much-needed warehouse space has been added,
and numerous aesthetic improvements have been made.

Businesses operating out of JFK say that the improvements have made a
difference. And, transportation problems aside, JFK is still a major
stop for most airlines.

"It's in the center of the East Coast market ... obviously it's a major
point for us," said Disenbach of Nippon Cargo, noting that the company
has made long term investments in its own building at JFK. "We're going
to stay here and make it work."

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